If Bill Gates held onto every share of Microsoft (MSFT -1.90%) stock he owned following the company’s initial public offering (IPO) in 1986, he’d be worth well over $1 trillion. As it stands, he’s still worth more than $100 billion.

Gates prudently sold off shares amid Microsoft’s rise to invest in a diversified portfolio. Little did he know Microsoft would continue to grow well beyond the levels it reached in the 1990s to become the $3 trillion company it is today.

Gates started a foundation in his father’s name in 1994 to support global health, which eventually became part of the Bill & Melinda Gates Foundation in 2000. Over the last 30 years, Bill and ex-wife Melinda have given away $47.7 billion of their wealth. The only people giving more are Warren Buffett and his family, according to Forbes. One of the beneficiaries of Buffett’s donations is the Bill & Melinda Gates Foundation, where he served as a trustee from 2006 to 2021.

The foundation’s trust shows the influence of both Gates and Buffett in its highly concentrated portfolio. While it holds around $44 billion in equity investments, 65% of that is held in just three stocks. Let’s take a closer look at each one.

1. Microsoft (26%)

The vast majority of Gates’ wealth stems from Microsoft, the company he founded 50 years ago. While it boasts a $3 trillion market value today, Gates now owns less than 1% of the business after his most recent donation of shares to the Gates Foundation in 2022.

That donation added more than 38 million shares of the stock to the foundation’s trust. After selling off some shares to fund operations in 2024, the trust still held about 28.5 million shares as of the end of the year. Those shares are worth about $11.8 billion as of this writing.

The Gates Foundation trust has done well holding onto those Microsoft shares as long as possible. The stock climbed more than 70% since the end of 2022, fueled by growth in artificial intelligence (AI) spending.

Microsoft is positioned to capitalize on growing AI spending in two ways. First, its Azure cloud computing platform has seen rapid uptake of its AI services thanks, in part, to its relationship with OpenAI. Microsoft has invested about $13 billion in OpenAI and is the generative AI leader’s largest shareholder.

Microsoft also benefits from integrating new AI-powered features into its enterprise software with its various Copilots for Github, Microsoft 365, and its marketing platform. Microsoft also enables businesses to use their own data to create AI agents using Copilot Studio. As AI spending continues to soar in 2025, Microsoft should see strong returns from both businesses.

Microsoft stock trades for 31 times forward earnings as of this writing. That’s a premium to the overall market, but it arguably deserves a significant premium. As mentioned, Microsoft is well positioned to benefit from the continued increase in AI spending. On top of that, it produces huge amounts of free cash flow, which management uses to buy back shares and pay a nice dividend. It also ensures the company can invest enough to capitalize on potential opportunities, like the current AI boom.

2. Berkshire Hathaway (22%)

Warren Buffett makes an annual donation to the Gates Foundation each year in the form of Berkshire Hathaway (BRK.A -0.58%) (BRK.B -0.64%) Class B shares. Buffett maintains control of his company by converting his super-voting Class A shares to Class B shares before donating them to several charities each year.

As of the end of 2024, the Gates Foundation held 19.7 million shares of Berkshire Hathaway. Those are worth roughly $9.5 billion as of this writing.

Buffett stipulates that the foundation must disseminate the entirety of his donation each year plus an additional 5% of its net assets. As a result, the trust often ends up selling some of its Berkshire holdings over time. It cut 11% of its stake last quarter. Nonetheless, it usually finds a way to hold onto a significant number of shares while qualifying for Buffett’s next donation.

Building that position in Berkshire Hathaway has been another great move for the trust. Shares hit a new all-time high in November, and the company’s value sits above $1 trillion.

Much of Berkshire’s value stems from its equity portfolio. Based on its fourth-quarter portfolio disclosure, the holding company has roughly $297 billion in equity investments. Additionally, the company has $325 billion in cash and Treasury bills on its balance sheet as of the end of Q3. That amount likely increased in Q4 due to additional equity sales and strong operating income from its core operations.

Berkshire’s operating income is nothing to sneeze at either. It grew 14% year over year through the first nine months of the year, reaching $32.9 billion. That comes on the heels of 21% growth in 2023, which was in part fueled by strong investment returns in its insurance business.

Berkshire stock is arguably expensive right now. It trades for 1.66 times book value as of this writing, which is well above its historical average. And while there are good reasons for Berkshire to trade for a higher multiple these days, even Buffett himself seems to think the current price is too much. He passed on repurchasing shares of the stock with his massive cash reserves for Q3, the first time since 2018 a full quarter went by without Buffett buying back at least a few shares of the company.

3. Waste Management (17%)

Waste Management (WM -0.48%) is one of the oldest holdings in the Gates Foundation trust. It represents the type of business Gates found most appealing as an individual investor to diversify away from his huge stake in Microsoft. It’s a boring business with a massive competitive moat. Warren Buffett would approve.

Waste Management is the largest waste collection and disposal company in the United States, and that position is cemented by its landfill ownership. Regulatory hurdles make it extremely difficult for any competitor to come in and match Waste Management’s position in the market, thus strengthening its advantages. The company’s scale also allows it to generate higher operating margins by keeping its routes dense and efficient.

While the core waste-hauling business produces steady growth from price increases and household formation, it’s able to leverage its size to grow through acquisition. The most recent acquisition was Stericycle, which the company closed in November. The company expects to extract $250 million in synergies from the acquisition, $100 million of which will come in 2025.

2025 looks bright for the business with management calling for a “step change in the company’s revenue and earnings.” Management’s forecast calls for 16% revenue growth and a 15% increase in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA).

Waste Management stock currently trades for an enterprise value 14.3 times management’s 2025 EBITDA outlook. With its EBITDA margin expanding as it integrates Stericycle and shows operating margin improvements in its core business, combined with strong revenue growth, that’s a fair price to pay for the stock. As such, it wouldn’t be a surprise to see the Gates Foundation continue holding shares in 2025 and beyond.